If you noticed that your daily cup of coffee now costs more, you’re not imagining things.
Inflation, defined as a sustained rise in the prices of goods and services, recently hit close to a 14-year high of 5% in March this year.
Fortunately, it was a step down from the 5.5% logged in both January and February.
These numbers, however, seem like a temporary spike rather than a long-term trend.
Inflation rates in Singapore have averaged around 2.5% from 1961 to 2021, a six-decade period.
If you are looking to beat inflation, parking your money in stocks with good dividend yields is an effective move.
These dividends form a stream of passive income that not only help you stay ahead of inflation but also better prepare you for retirement.
Here are four Singapore stocks with high dividend yields that you can consider for your buy watchlist.
UMS Holdings Limited (SGX: 558)
UMS acts as a one-stop shop for original equipment manufacturers (OEMs) of semiconductors and related products by providing equipment manufacturing and engineering services.
The group has production facilities in Singapore, Malaysia, and the US.
UMS reported a sparkling set of earnings for 2022, with revenue jumping 37% year on year to S$372.4 million.
Net profit surged 85% year on year to S$98.2 million.
The group also generated a free cash flow of S$41.8 million last year.
A final dividend of S$0.02 was declared, bringing the total dividend for 2022 to S$0.05.
UMS is one of a handful of companies that dole out quarterly dividends, and its shares sport a trailing dividend yield of 4.9%.
The group will continue to expand its capacity to meet customer demand, with the construction of its new Penang factory scheduled for completion in the middle of 2023.
Fraser & Neave (SGX: F99)
Fraser & Neave, or F&N, is a consumer group with two main divisions – food and beverage, and publishing and printing.
The group is present in 11 countries and employs more than 6,700 people worldwide.
For its fiscal 2023’s first half (1H FY2023) ending 31 March 2023, F&N saw revenue inch up 3.5% year on year to S$1.05 billion.
Net profit, however, fell by nearly 20% year on year to S$55 million because of higher marketing and administrative expenses.
Despite the lower profit, the group saw its free cash flow reverse from negative S$80 million in 1H FY2022 to a positive S$71.5 million in 1H FY2023.
An interim dividend of S$0.015 was declared, unchanged from a year ago, bringing the trailing 12-month dividend to S$0.05.
F&N’s trailing 12-month dividend yield stood at 4.5%.
The group has secured rights to exclusively manufacture and distribute Nestle’s (SWX: NESN) BEAR BRAND sterilised milk in Cambodia with an arrangement that will last till 2027.
CSE Global (SGX: 544)
CSE Global provides integrated engineering systems for clients in the Energy, Infrastructure, and Mining and Minerals sectors.
The group has a presence in 16 countries and has 51 offices globally employing 1,800 staff.
Revenue for 2022 improved by 19% year on year to S$557.7 million but net profit plunged y 68.2% year on year to S$4.8 million.
The poorer showing was due to a one-off restructuring cost and cost overruns incurred on two projects during the year.
CSE Global kept its 2022 dividend constant at S$0.0275, giving its shares a trailing dividend yield of 8.1%.
As of 31 December 2022, CSE Global saw its outstanding order book double year on year to S$480.1 million.
2022 also saw the group clinch new orders of S$808.4 million, 75% higher than a year ago.
Just this week, the engineering group announced that it had clinched S$159.6 million of orders for its fiscal 2023’s first quarter, a 31.3% year on year improvement.
HRNetGroup (SGX: CHZ)
HRNetGroup is a leading recruitment and staffing firm with over 900 consultants across 15 Asian cities.
The group has 13 brands such as HRNetOne, PeopleSearch and RecruitFirst across 40 business units.
2022 saw HRNetGroup post a 3.6% year on year increase in revenue to S$611.8 million, although gross profit slipped by 0.4% year on year to S$174.2 million.
Net profit inched up 3.1% year on year to S$67.5 million.
The human resource specialist paid out a dividend of S$0.04 for last year, with its shares sporting a trailing dividend yield of 5.5%.
Management believes that the group can continue to do well as the GDP growth rate is projected to be positive in all the countries that it operates in, thereby boosting job creation.
Our team has spent decades scouring SGX for stocks. And we think dividends could be the answer to rising inflation and market uncertainty in 2023. With our newest FREE report, you’ll have everything you need to find, keep and make more money from dividend stocks. Click here to download it for free.
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Disclosure: Royston Yang does not own shares in any of the companies mentioned.
